Download Employment Update - Greater Houston Partnership

Employment Update
March 7, 2014
Today, the Texas Workforce Commission (TWC) released revised monthly estimates1 of nonfarm
payroll employment for ’11, ’12 and ’13. The revised data reflect adjustments to total employment and
to the sectors and subsectors the agency tracks. The revisions show that ’12 was better than previously
thought. In fact, ’12 proved to be the second best year on record for job growth. The revisions also
show how much Houston’s economy slowed in ’13.
Of special note, in December’12, the Greater Houston Partnership forecasted the region would add
76,000 jobs in ’13. With today’s data release, the Partnership’s forecast proved to be off by only 200
jobs, essentially a rounding error in an economy with more than 2.8 million in nonfarm payroll
employment.
Revisions to Houston Metro Area Net Change in Payroll Employment
Year
Original Estimate
’11
’12
’13
81,200
105,700
82,000
Revised Report
Net Change
80,500
115,400
76,200
-700
+9,700
-5,800
Source: Texas Workforce Commission
Five Best Years for Job Growth Since ’81
Year
Net Change
(12 Months Ending Dec)
’81
’12
’06
’97
’90
126,900
115,400
105,800
104,600
98,400
Source: Texas Workforce Commission
TWC significantly revised employment downward, meaning ’13 ended with fewer jobs than originally
thought, in eight sectors:
Significant Downward Revisions to Employment by Sector
Sector
Administrative Services
Employment
-8,600
Health Care
Retail Trade
Engineering & Architectural Services
Local Education
Machinery Manufacturing
Wholesale Trade
Depository Credit Intermediation (Banking)
-6,200
-5,800
-2,100
-2,000
-1,800
-1,500
-1,100
Source: Texas Workforce Commission
The downward revision in health care employment is not surprising given the uncertainties associated
with the Affordable Care Act. The downward revision in retail employment does not reflect a
slowdown in activity. The revision is more likely due to inherent difficulties in estimating growth in that
sector. The same holds true for wholesale trade. The slowdown in oilfield services led to a weakness in
machinery manufacturing and thus the revision. The downward revisions to credit intermediation
(banking) reflects restructuring of the industry due to uncertainty brought on by the Dodd–Frank Wall
Street Reform and Consumer Protection Act and the trend to provide more services online. The
significant downward revision in administrative services is a concern since the sector includes the
employment services subcategory. Growth and contraction in employment services often portends
growth or contraction in the economy as a whole.
Significant Upward Revisions to Employment by Sector
Sector
Employment
Restaurants and Food Services
+7,300
Specialty Trade Contractors (Construction)
+3,000
Non-Durable Goods Manufacturing
+3,000
Other Services
+3,000
Source: Texas Workforce Commission
The upward revisions for restaurants and food services suggest Houstonians still enjoy dining out. The
improved employment numbers for specialty trades contractors says the data has finally caught up to
what every driver sees from their car window. Construction is booming. And the revision to other
services is more likely due to inherent difficulties in estimating growth in a sector dominated by small
businesses.
Every major sector except finance recorded employment gains in ’13. Those gains are summarized
below.
Houston MSA Nonfarm Payroll Employment
Industry/Sector
Total Nonfarm
Total Private
Goods Producing
Mining and Logging
Construction
Change Dec ’12 - Dec ’13
Jobs
%
76,200
2.8
69,400
2.9
16,000
3.0
4,300
4.2
4,700
2.6
Houston MSA Nonfarm Payroll Employment
Industry/Sector
Manufacturing
Durable Goods
Nondurable Goods
Service Providing
Private Service Providing
Trade, Transportation, and Utilities
Wholesale Trade
Retail Trade
Transportation, Warehousing and Utilities
Information
Financial Activities
Finance and Insurance
Real Estate and Rental and Leasing
Professional and Business Services
Professional, Scientific, and Technical Services
Administrative Support and Waste
Management
Educational and Health Services
Educational Services
Health Care and Social Assistance
Leisure and Hospitality
Other Services
Government
Change Dec ’12 - Dec ’13
Jobs
%
7,000
2.8
3,200
1.9
3,800
4.7
60,200
2.7
53,400
2.9
15,700
2.7
6,300
4.3
5,500
1.9
3,900
3.0
900
2.8
-800
-0.6
-1,600
-1.8
800
1.6
10,200
2.4
6,800
3.4
3,000
1.5
6,100
2,200
3,900
18,500
2,800
6,800
1.8
4.5
1.4
7.1
2.9
1.8
Source: Texas Workforce Commission
A more detailed look at the revisions and the January-to-January employment data will appear in the
March issue of Houston: The Economy at a Glance.
1
The employment estimates released throughout the year are based on a sample survey of area employers.
Starting in the fall, TWC revises the job numbers based on data available from unemployment insurance
accounts. In revising the data, TWC looked back over the previous 21 months. TWC “re-benchmarked” the data
back to March ’12. In some instances, the data were revised back to January ’11.
For the latest data, click here.
Prepared by Greater Houston Partnership Research Department
Patrick Jankowski, CCR
Vice President, Research
713-844-3616
[email protected]
Jenny Philip
Manager, Economic Research
713-844-3615
[email protected]